Summit's eve brings tax-cut pledge Clinton aide says economic recovery wouldn't scrap break for middle class

December 14, 1992|By Gilbert A. Lewthwaite | Gilbert A. Lewthwaite,Staff Writer

LITTLE ROCK, Ark. -- As more than 300 delegates arrived here for today's opening of President-elect Bill Clinton's economic summit, the conference's organizer said a middle-class tax cut would be included in the new administration's economic program despite signs of economic recovery.

"It is going to happen. We are going to have a middle-class tax cut," said Mickey Kantor, coordinator of the conference, which brings together representatives of business, labor, academia and the social services to help shape the Clinton administration's economic policies.

Recent economic indicators -- lower unemployment, stronger growth, increased demand and rising consumer confidence -- have led to speculation that Mr. Clinton might not need to stimulate growth as much as he initially anticipated and could switch his focus to reduction of the federal deficit.

A middle-class tax cut could add to the deficit in the short-term, and it probably will be a contentious issue at the conference, with many economists urging Mr. Clinton to drop the tax-reduction proposal.

Mr. Kantor, interviewed on ABC's "This Week with David Brinkley," said the economic plan would also include investment and research and development tax credits, and "some form" of reduction in the capital gains tax -- all part of Mr. Clinton's campaign blueprint.

Mr. Clinton and Vice President-elect Al Gore will be chairmen of the economic summit today and tomorrow. Also present will be Mr. Clinton's new economic team, including designated Treasury Secretary Lloyd Bentsen and Leon E. Panetta, who will be budget director.

The president-elect will give only a broad outline of his economic program. He will not present any detailed proposals, partly because the final decisions will not be made until he sees the latest economic figures before his Jan. 20 inauguration. Those data will be crucial to his decision on how much stimulation the economy needs.

Some political observers think Mr. Clinton is taking a risk by presiding over a meeting that is likely to produce more conflict than consensus on economic stimulus and other issues, including free trade vs. tough reciprocity.

But Mr. Clinton and his advisers are approaching the two-day summit as a sounding board of public concern and an opportunity to educate citizens on the short-term and structural problems of the economy.

The conference will focus on six major issues: the domestic economy, the international economy, lifetime learning, short-term growth, long-term growth and deficit reduction; and the environment and technology.

Mr. Kantor said the sessions will have three purposes: to "connect" the president-elect with the public; to provide an up-to-the-minute assessment of the domestic and international economies; and "to put some meat on the bones" of the Clinton economic policy.

"This is a way of beginning to connect the people of this country to their leaders and begin to move forward," Mr. Kantor said.

People from all 50 states will attend the conference. They include economic scholars, corporate chiefs and the owner of a South Dakota flower shop, Kathleen Piper.

Each session will open with experts outlining the problems and opportunities. After the formal presentations, other participants will be able to join in. There also will be phone-in opportunities for the general public, who will be able to follow the proceedings on C-SPAN, the cable network that covers Congress; and National Public Radio.

Planners think the format will create the atmosphere of a town meeting, which Mr. Clinton conducted during his election campaign.

This morning, Mr. Clinton will deliver an opening statement and then turn over the conference to a panel discussion on the economy. Nobel Prize-winning economist Robert Solow of the Massachusetts Institute of Technology will be the moderator.

Two of the 326 conference delegates are from Maryland: developer James Rouse, who heads the Enterprise Development Corp. in Columbia, and Bennie L. Thayer of the National Association for the Self-Employed in Capitol Heights.

A former director of the Johns Hopkins University Policy Institute, Charles McMillion, now president of MBG, a Washington consulting group, will make a presentation on short-term growth.

Besides Mr. Solow, members of the academic community at the summit include John White of Harvard University's Kennedy School of Government, who drafted independent candidate Ross Perot's economic program; Johnetta B. Cole, president of Spelman College in Atlanta; and William H. Gray III, president and chief executive officer of the United Negro College Fund.

Among those representing the social sciences will be Marian Wright Edelman, founder and president of the Children's Defense Fund, and Heather Weiss, founder and director of the Harvard Family Research project. Labor's featured speaker will be Lynn R. Williams, president of the United Steelworkers of America.

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